The Rezidor Hotel Group today announced an agreement to exit from seven lease agreements in France by the end of the year.
The hotels comprise a total of nearly 700 rooms and are mainly operated under the Park Inn by Radisson brand. They are located in secondary locations and have proven consistently unprofitable for Rezidor.
To exit from the leases, Rezidor agreed to a payment to the owner, Hibernia France, of MEUR 11.5 in 2012. The exits will positively affect Rezidor's EBITDA by approximately MEUR 2 annually. In addition, Rezidor will hand over responsibility for future capital expenditures.
The seven hotels will remain under their existing brands and will be operated by Rezidor for the next few years under management agreements. Should Hibernia France sell the properties, the management agreements will be terminated thereafter. The decision to exit these hotels was made after determining that the hotels' financial situations were unlikely to turnaround and their positioning and locations are not commensurate with the future direction of the brands.
Rezidor remains committed to the French market and continues to operate two other Park Inn properties in France (in Paris and Nice), have a third hotel opening in Lille in Q4 2012, and will add other strategic locations in the coming years. The company's other core brand, Radisson Blu with 16 hotels, is the largest upscale brand in France in terms of number of hotels.
"This very important asset management deal is in line with our Route 2015 goal to lift Rezidor's EBITDA margin by 6-8 percentage points by 2015. It is of fundamental importance to the group to further optimise our portfolio of leased hotels, secure more profitable income streams in the years ahead, and reduce the leverage of the company", says Knut Kleiven, Deputy President and CFO at Rezidor.
The affected hotels are:
Park Inn by Radisson Arcachon
Park Inn by Radisson Macon
Park Inn by Radisson Orange
Park Inn by Radisson Nancy
Park Inn by Radisson Lyon Ouest
Radisson Blu Hotel, Aix-Les-Bain
Les Loges du Park (unbranded)
The information here is that which Rezidor Hotel Group AB has willingly chosen to make public or that which it is obliged to make public according to the Swedish Securities Market Act and/or the Financial Instruments Trading Act.
For further information, kindly contact:
Knut Kleiven, Deputy President and CFO
+32 2 702 9244, email@example.com
Ebba Vassallo, Director Investor Relations
+32 2 702 9286, firstname.lastname@example.org
About the Rezidor Hotel Group
The Rezidor Hotel Group is one of the fastest growing hotel companies worldwide and a member of the Carlson Rezidor Hotel Group, one of the world's ten largest hotel groups. Rezidor features a portfolio of more than 435 hotels in operation and under development with over 95,000 rooms in 71 countries. Rezidor operates the brands Radisson Bluand Park Inn by Radisson in Europe, the Middle East and Africa, along with the Club CarlsonSM loyalty programme for frequent hotel guests. Under a worldwide licence agreement with the iconic Italian fashion house Missoni, Rezidor also operates and develops the luxury lifestyle brand Hotel Missoni. In September 2012, Rezidor signed a strategic alliance agreement with Regent Hotels & Resorts to develop and operate Regent properties in Europe, the Middle East & Africa.
Since November 2006, Rezidor is listed on the Stockholm Stock Exchange (REZT).
Carlson, a privately held, global hospitality and travel company, based in Minneapolis (USA), is the majority shareholder.
The Corporate office of The Rezidor Hotel Group is based in Brussels, Belgium.
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For more information, visit www.rezidor.com.
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Source: Rezidor Hotel Group via Thomson Reuters ONEHUG#1652093